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Every month the U.S. Treasury releases data on the federal budget, including the current deficit. The following contains budget data for December 2019, which was the third month of fiscal year (FY) 2020.
The deficit for December 2019 was about the same as that recorded in December 2018. In both years, certain federal payments were shifted into December because January 1st is a holiday, and into November because December 1st fell on a weekend. Without such timing shifts, the December 2019 deficit would have been about $3 billion larger.
The cumulative deficit through the first three months of FY20 was $38 billion larger than it was through the first three months of FY19. In both years, certain federal payments were shifted into December because January 1st is a holiday. The size of those shifts was about the same in both years, so they had no effect on the difference in the deficit between the two years.
The increase in the cumulative deficit reflects a $73 billion increase in outlays partially offset by a $35 billion increase in revenues.
While the deficit varies from month to month, and may even decline some months — for example, in April when taxpayers are submitting their personal income taxes — debt and deficits are on an unsustainable upward trajectory. The CBO projects that national debt could rise to about 140 percent of gross domestic product by 2049. That level of debt would far exceed the 50-year historical average of approximately 40% of GDP.
Why are such high levels of debt so concerning? There are many reasons that Americans should be concerned about the rising national debt — particularly if you are concerned about economic growth, investments in our nation’s future, and preservation of our social safety net.